Trans Mountain pipeline construction progressing

A federal regulator cleared the way for the construction of four segments of a pipeline backed financially by the Ottawa government.

A federal regulator signs off on plans from Kinder Morgan to build sections of its expanded Trans Mountain pipeline in British Columbia. File Photo by Kodda/Shutterstock

Aug. 17 (UPI) -- The group building the Trans Mountain oil pipeline can proceed with construction of an expansion project through parts of British Columbia, a regulator said.

The National Energy Board, a Canadian energy regulator, said construction on four segments of the expansion effort can proceed in the provincial interior from a terminal in Edmonton to a pumping station.

The NEB is working in stepwise fashion to review and approve the expansion effort after a series of provincial disputes over the pipeline.

"For the entire pipeline route, 72 percent of the entire detailed route has now been approved," an NEB statement read.

In an April 18 financial statement, pipeline company Kinder Morgan, which is leading the project, said judicial action by the provincial government in British Columbia was thwarting the timeline for Trans Mountain. The company set a May 31 deadline on clarity for the project.

The federal government announced plans to purchase Kinder Morgan's pipeline and terminal assets for $3.5 billion, two days before the company was set to shelve the project. Kinder Morgan has been steering efforts to triple the capacity of a pipeline to Canada's west coast amid bitter provincial divisions.

British Columbia Premier John Horgan said his government, which has moved to thwart the project, would continue to defend provincial interests. For the western province, projects like Trans Mountain present a source of environmental concern.

The pipeline to western export terminals is important for a Canadian economy that sends nearly all of its oil exports to the United States, which is producing more of its own oil because of the shale boom. The Keystone XL oil pipeline from Alberta to southern U.S. export terminals is delayed by legal issues in Nebraska.

For Kinder Morgan, Moody's Investors Service said the federal decision to support the project was credit positive because it removes "significant risk" for the company and eliminates the need for another $4.9 billion in costs "and the uncertainty of construction scheduling and completion given the opposition to the project from the province of British Columbia, environmentalists and some First Nations."

The NEB said it was being deliberate in its oversight of the expansion effort. Hearings for another segment of the project in British Columbia are scheduled for October.